Berty:
Rjan:
To be genuinely self-employed, and stating the point very generally, you have to be an owner (of business capital), an employer, or have recognisable authority over your customers.If you are/have none of these to any significant degree, the self-employment is basically not genuine.
It is otherwise perfectly possible to be an employee who fills up the vehicle and then claims on expenses, and it is perfectly possible to be a businessman with only one client.
But owning a pair of gloves and toe-capped boots does not make you an owner, occasionally bunging some work to a “self-employed” friend does not make you an employer, and one driver in a marketplace of thousands does not stand as the authority figure against a large corporation or the peripheral businesses which supply it.
yet thousands stil do it knowing this information or vaguely knowing it but carry on anyway… what’s the worst that could happen? hmrc saying you need to stop it or will they get a fine or made to repay something of some sort?
It’s not entirely a one-way bet though, because typically the gross “self-employed” rate is lower than the gross PAYE rate, and you lose security of employment and a raft of peripheral rights, benefits, and protections.
Just the right to a week’s notice after one month’s continuous employment (or a series of employments punctuated by temporary cessasions, that are treated as continuous under the ERA 1996) could be worth hundreds of pounds to an employee. Then there is holiday pay, sick pay, redundancy pay, the state guarantee of unpaid wages in the event of the insolvency of the employer, pension contributions, and probably other things, that are lost.
And if the taxman does come calling, which he is more likely to do with those who feel they are doing best out of the self-employed arrangements rather than those who have made only slight gains, even without any fine or penalty being imposed you’ll be appreciably worse off than if you’d been on PAYE and you’ve got to find money out of your own pocket to repay what has already been spent maybe years beforehand.
Most fiddlers don’t put the money aside to see which way the bet goes, any more so than does the burglar or the fraudster - they do it on the assumption they won’t be caught and may not be here tomorrow (the same optimism that convinces them that redundancy pay, sick pay, and pensions are worth less than hard cash paid today), so if they are caught and forced to repay, the pain is far greater than if it was just a case of giving back stored funds, because they’ve already lived a lifestyle as though the unpaid tax was theirs to keep.